Insiders have welcomed the appointment of Steve Rowe as the new CEO of Marks & Spencer, labelling him an “incredibly effective trader”.
The promotion follows the surprise retirement of current boss Marc Bolland, who is stepping down from the high street bellwether after six years in the role. He will hand over the reins at the end of the financial year on 2 April and will remain available as an advisor until the summer.
Rowe is the executive director of the struggling general merchandise arm and former head of the food division - a position he held for three years. He has been with M&S for over 25 years, sitting on the board since 2012.
“It’s a very popular decision,” a former colleague of Rowe’s said. “Steve is an M&S lifer, but he is highly respected and liked and valued at all levels. Above all, he is a trader and they wanted a trader back running the business.”
A headhunter source added: “Steve is a bit of a rough diamond. He’s not the smooth corporate man like Bolland. But he’s an incredibly effective operator and trader. He’s really strong on the detail, has good vision and has earned the loyalty of his staff with his values and his ability.”
“Steve is an M&S lifer, but he is highly respected and liked and valued at all levels. Above all, he is a trader and they wanted a trader back running the business”
M&S chairman Robert Swannell also praised Rowe for “his appetite to continue the process of change, particularly in General Merchandise, his perceptive and effective problem solving, his values and his observed leadership.”
“The Nomination Committee was unanimous in supporting Steve’s appointment,” Swannell added.
The scale of the challenge facing Rowe was laid bare in the M&S Q3 trading update for the 13 weeks to 26 December. Like-for-like sales plunged 5.8% in the GM division, which Rowe took charge of in June, despite coming up against last year’s soft comparatives.
The markets also reacted favourably to the appointment, with shares in M&S climbing 2% on Thursday to 447.3p, despite the weak Christmas performance in clothing.
“Solving the puzzle of a business with two divisions heading in opposite directions eluded his predecessor. And it’s unlikely he will be given long to find a solution.”
Retail Vision analyst John Ibbotson said Rowe was well-respected within the business and should be applauded for delivering 12 successive quarters of growth when in charge of the food operation. “But [he] now faces a far tougher challenge as CEO of what has become a truly schizophrenic empire,” he added. “While the food operation’s distinctive positioning means its prospects are good, M&S’s clothing business has become a complete also-ran.
“Solving the puzzle of a business with two divisions heading in opposite directions eluded his predecessor. And it’s unlikely he will be given long to find a solution.”
Although the announcement came as a surprise to the market and to M&S insiders, Bolland insisted that he had notified Swannell of his decision to stand down last summer. And in a call to journalists Swannell added there was no board-level pressure on Bolland to leave as results worsened in GM, “Over the last six years Marc Bolland has led M&S through a period of necessary change,” Swannell said. “It is now positioned for a digital age, with its own online platform and dedicated e-commerce distribution centre, improved design and sourcing capabilities in GM and an industry-leading track record of growth and innovation in the food business.”
”Steve has a rare quality that combines strong commercial skills, a very challenging approach, an ability to get to the heart of a matter and to focus on the right thing, and great popularity”
Shore Capital analyst Clive Black concurred in a tribute to Bolland’s contribution to the retailer. “Mr Bolland, a distinguished commercial statesman, has done a lot of very good work to fundamentally modernise and reposition M&S to be fit for the future in sustainably challenging markets.
“His replacement, the excellent and highly energetic Steve Rowe, has a much stronger platform with which to take the business forward than Mr Bolland inherited.”
”Steve has a rare quality that combines strong commercial skills, a very challenging approach, an ability to get to the heart of a matter and to focus on the right thing, and great popularity,” said Andy Adcock, M&S director of food. ”There’s no one who knows more about M&S end to end. He is a natural leader and great motivator and his appointment is seen as a great choice within M&S.
”I am sad Marc is leaving. He has had a big influence on the development of our food offer, backing that up with substantial investment, and he’s been a big supporter of me personally. But I’ve worked closely with Steve for years and I welcome the chance to do so again. He’s the right man for the job.”
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